Brazilian steel considers appeal against tariffs

SÃO PAULO — The Brazilian government and national steel institute Aço Brasil are deciding whether to “immediately file an appeal” with the United States government against its “extreme” decision to impose a 25% tariff on steel imports, the association said late on Thursday March 8.

The group understands that the “blockage” of Brazilian steel exports to the US market – mostly slab steel, which is re-rolled by US mills – will cause considerable damage not only to Brazil-based companies, but also to North American firms that are not able to produce their own semi-finished goods.

The institute and the Brazilian government also will analyze ways to prevent the local steel market from being affected by the redirection of steel volumes away from the US to other countries because of the new import tariffs.

All steel products, including slab, are to be included in the US trade measures, which are scheduled to become effective on March 23.

The US government has noted, however, that it is authorized to provide relief from the import duties in the case of any steel material that it determines is not produced in the US in sufficient quantity, or with reasonable availability, or of satisfactory quality.

But such relief shall be provided for a steel product only after a request for exclusion is made by a directly affected party located in the US, it added.

“Slab shall be included in the exemptions list,” a Brazilian trader said. “I hope that slab is excluded from the measure.”

US-based companies that are relevant importers of slabs include California Steel Industries (CSI), Novolipetsk Steel (NLMK), Essar Steel, AK Steel, and the AM/NS Calvert facility in the state of Alabama - a joint venture between ArcelorMittal and NSSMC.

The major Brazilian slab exporters are Ternium, Companhia Siderúrgica de Pecém (CSP) and ArcelorMittal Tubarão.

In 2017, Brazil exported 2.45 million tonnes of slab to the US, up from 2.11 million tonnes in 2016, according to figures released by the country’s foreign trade ministry, MDIC.

Brazilian industrial association CNI has said that it also opposes the “unjustified and unlawful” decision of the US to impose additional tariffs on steel and aluminum exported by Brazil and other economies.

“The measures will affect $3 billion in Brazilian exports of iron and steel and $144 million in aluminum exports,” CNI said.